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Sharpton gets big gun to fend off feds

Friday, June 20th 2008, 12:22 AM

Facing an escalating federal probe into his charity's finances, the Rev. Al Sharpton now has his own muscle: former Brooklyn U.S. Attorney Zachary Carter.

Sharpton said Thursday he hired Carter - a respected ex-prosecutor - to represent him and his National Action Network because he thinks the probe has become politicized.

"When I see staff members of mine woken up at 6 a.m. and handed subpoenas...I don't trust this Justice Department," Sharpton told the Daily News.

Federal agents rousted Sharpton's former chief of staff and several other NAN employees one morning last December to serve subpoenas issued by the Brooklyn U.S. attorney's office seeking financial records.

"Zachary Carter knows the workings of that office and is totally aware of what is proper," Sharpton said. He insisted he did not hire the former prosecutor because he fears criminal charges are looming.

"If I thought I had a problem like that, I'd have hired a gunslinger," he said.

Prosecutors and the Internal Revenue Service have been investigating whether Sharpton misstated the amount of money he raised during his 2004 run for President in order to qualify for matching federal funds. They are also looking into possible tax fraud involving the reverend and NAN.

Recently, the probe took a new turn, sources said, when subpoenas were served on several corporations that have donated money to the charity. The move prompted speculation that the feds are examining whether the payments were made in response to threats by Sharpton of boycotts and demonstrations.

"News Corp. [which owns the New York Post] bought two tables to my annual [Martin Luther King Jr.] dinner in 2005. So why is it when it's in their interest, it's called 'outreach' and when it's not, they say it's a shakedown?" Sharpton said.

On Wednesday, Sharpton wrote a letter to Rep. John Conyers (D-Michigan), who chairs the House Judiciary Committee, requesting a review of the Brooklyn U.S. attorney's actions for possible "abuse of power," a Sharpton spokeswoman said.

Conyers is leading a probe into charges that nine U.S. attorneys were forced to resign for political reasons by former Attorney General Alberto Gonzalez.

"We are mindful of the clear political motivation of the Justice Department and the IRS under this present administration," Sharpton said.

Carter, a partner in the Manhattan law firm Dorsey & Whitney, was hired about three months ago.

"I have no comment beyond the fact that my firm has been retained in connection with this matter and that we are cooperating fully with the United States attorney's office," Carter said in a statement.

Brooklyn U.S. Attorney Benton Campbell declined to respond to Sharpton's charges.

Sharpton and NAN owe several million dollars in back taxes, but Sharpton attributed the problem to a fire at his Harlem headquarters that destroyed many records. Much of the amount owed consists of penalties he's vigorously disputing.

jmarzulli@nydailynews.com

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